From South Korea,sephia And Sportage

Those not transfixed by Oprah's battle with the burger may have noticed that another world power, South Korea, has been the object of media attention for teetering on the brink of financial collapse.

The Korean economy seems to have been built on a sinkhole. The country has more debt than land, and the best use for its currency in recent months has been to cover walls.

Just the setting for a South Korean automaker to set foot in this town to say "Howdy."

Yet that's what Greg Warner, executive vice president of North American operations for Kia Motors of South Korea, is doing this week as he visits Chicago to unveil a pair of vehicles at the auto show, Saturday through Feb. 15 in McCormick Place South, and meet with dealers who will start selling the Sephia sedan and Sportage sport-utility here for the first time next month.

Warner's career includes 14 years with Toyota, where he helped develop its U.S. production and distribution before moving to Hyundai to help the South Korean automaker's U.S. launch.

Kia arrived on the West Coast in 1994, then swung through the South and up the East Coast before venturing into the Snow Belt. Its late arrival here makes it a virtual unknown, though some will recall it briefly produced the Festiva and Aspire mini-cars for Ford, neither of which set sales or longevity records.

Like Hyundai, Kia caters to economy-minded consumers intent on high mileage and low price over styling and performance, offering inexpensive new-vehicle alternatives to used cars.

Sephia, about the size of a Toyota Corolla, starts at $9,995. The Sportage, about the size of a Toyota RAV4, starts at $14,895 in two-wheel-drive, $16,395 in four-wheel-drive. With four-wheel-drive, automatic transmission and air conditioning, Sportage goes out the door for about $18,000.

In displaying vehicles here, Kia joins Hyundai in giving the auto show a South Korean presence.

But one South Korean is conspicuous by its absence. Daewoo booked space in preparation for setting up a dealer network in the U.S., but then canceled.

An omen for South Korean automakers?

"Dae who?" Warner jokes. "I'm not going to let them concern me. We've had a step-by-step program in place to expand in the U.S. since 1994 and we've been consistent in our plans."

Warner is optimistic about Kia's U.S. fortunes even if South Korea's economy is in the pits.

"A lot of consumers are aware of Korea's financial crisis, but they also are aware of the idea that nobody lets countries go bankrupt," he said.

"Being practical, Korea is still the 11th-largest economy in the world, and neither the U.S. nor the world financial community is going to let it go down the drain, because they have too much of a financial interest in it," he added.

Warner downplays South Korea's woes, stating that though the country's financial crisis surfaced in late 1997, Kia has set sales records each month from late August through January.

Kia produced one million vehicles at home last year. Its goal is to produce two million annually by 2005. The economic woes have been a temporary setback, however, and '98 production has been reduced to 800,000 to trim costs.

But while Kia will build fewer vehicles, it will ship more of them to the U.S. as it expands into more states and adds dealers.

Kia, which says more than 60 percent of its vehicles are bought by women, has other models in the works to help spur U.S. growth. Two are being unveiled at the auto show: a two-door Sportage convertible that goes on sale this spring, and a 2.5-liter V-6-powered, front-wheel-drive mini-van with dual slide-open doors that debuts for the 2000 model year.